https://orcid.org/0000-0003-2894-7426
![Sample our Health and Social Care journals, sign in here to start your FREE access for 14 days]({"type":"image" , "src" : "/sda/5938/TOC-Subject-Sample-2021-Health-Social-Care.jpg"})
Abstract
This paper tracks the arrival of investors in the housing market of Dudelange, Luxembourg. In so doing, it focuses on the socio-economic changes accompanying the transformation of homes into assets, since the first apartment was built in the city in the mid-1960s until 2018. Drawing on complete land registry data, we chart the structure of apartment ownership in the context of the city’s transition from an industrial to a financialised economy, with particular attention to three characteristics of buyers: age at purchase, country of birth and occupation. We investigate how homeowner characteristics have shifted over time in a context where housing policies have incentivised investor activity and demand. We highlight how three policies put in place in the early 2000s to encourage real estate investments seem to have strengthened the position of the group already most advantaged on the Luxembourg housing market: those born in Luxembourg and over 45 years of age. Given that this group has on average the highest median incomes and the highest homeownership rates, we argue that these policies that incentivised property investments are likely to have accelerated housing (and wider) inequalities in an overheated housing market.
Acknowledgement
We would like to thank the editor, the two anonymous reviewers as well as Chris Hamnett, Loretta Lees, Lindsay Flynn and Philippe van Kerm for their critical and constructive comments throughout the publication process. We would also like to thank the Administration du Cadastre et de la Topographie for all of their kind help since the beginning of this project, as well as Tiago Ferreira Flores for his research assistance.
Disclosure statement
No potential conflict of interest was reported by the authors.
Notes
1 This measure in particular caused concern for many professional associations, such as the Chamber of Trades and the Chamber of Employees. When the policy was scaled back in 2021, the chambers were of the opinion that the accelerated depreciation rate should be completely withdrawn as it provides undue advantage to investors over first-time buyers in an overheated housing market.
2 While age and country of birth are verified by the notary through ID cards, the occupation is declarative.
3 Parliamentary question 5374 (answered on 11/01/2022): https://www.chd.lu/wps/portal/public/Accueil/TravailALaChambre/Recherche/RoleDesAffaires?action=doQuestpaDetails&id=22693
4 Between 2012 and 2018, there was an average of 4.5 units per residence in Dudelange according to STATEC, the Luxembourg statistics agency
5 It is worth noting that there is only a small difference in the average price of units in these two types of developments, with units in smaller developments generally cheaper.
6 Each building appears only once, depending on the decade in which most of the apartments were purchased.
7 In the 1980s, there were 32 times more buyers born in Luxembourg as compared to those born elsewhere in LD, compared to 3 times more in SD. In the last decade, there were only 3 times more in LD and 1.3 times more in SD.
8 For couples we take into consideration three work scenarios: both individuals have a job, only one, or neither has a declared occupation in the notarial statement.